What do entrepreneurs do for the economy? Starter – famous entrepreneurs. What do you think is the most important entrepreneurial characteristic and why?

Where does this fit with your specification?

Learning objectives To be able to understand how and why entrepreneurs create the wealth for the economy through creative destruction. To be able to assess how innovation plays a part in creative destructive

Key words: Entrepreneur Creative destruction The Economy Try to define each.

Key words: Entrepreneur – Is a person that has already started or is in the process of starting of starting an enterprise Creative destruction – Is a process through which something new (innovative) brings about the ‘death’ of whatever existed before it. The Economy – The state of a country/region in terms of the production and consumption of goods and services and the supply of money

The role of an entrepreneur Entrepreneurs occupy a central position in an economy. It is the entrepreneurs who serve as the spark plug in the economy's engine, activating and stimulating all economic activity. The economic success of nations worldwide is the result of privately run businesses (set up by entrepreneurs)

Can an entrepreneur operate successfully without the other 3 factors of production? Explain.

Constructive Destruction (the idea came from Joseph Schumpeter) ‘Only those comfortable with creative destruction can call themselves entrepreneurs’ Z4IQ Z4IQ Branson may have been overconfident BUT, it is the cost of taking risks – look how successful he is from taking all these risks.

The concept of creative destruction highlights how creativity leads to new ideas, inventions and products – they may be so superior to existing products that they attract all of the customers. Business rely on INNOVATION to capture the market.

Task Try and think of as many INNOVATIVE products as you can. Then think about WHY they are better than existing products.

Innovation

A company in action eurs/laurabooth.shtml eurs/laurabooth.shtml What were Theo’s ‘words of wisdom’?

Why is the economy is boosted by entrepreneurs? It's entrepreneurial energy, creativity and motivation that trigger the production and sale of new products and services – this means taking a risk. Entrepreneurs seek disequilibrium – A gap between the wants and needs of customers and the products and services that are currently available – The entrepreneur then brings together the factors of production necessary to produce, offer and sell desired products and services. – They invest and risk their money--and other people's money--to produce a product or service that can be sold at a profit.

Discussion Why does being creative involve risk? What did Nokia do wrong in 2008? What role did Samsung and Apple play in the story?

Discussion 2 Does business success always rely on innovation?

The answer – innovation is not always necessary What do all these services/products have in common to make them successful?

Society and entrepreneurs Entrepreneurs have a key role in the economy: – They create jobs – It helps create dynamic markets (trends change) – Innovation occurs – We have better living standards Plenary Explain why all the above factors are interlinked and how entrepreneurs have this effect. Use the words: Economy, creative destruction in your summary.

Homework Find a small business that you know in your local area (it could be a local shop or service provider). Find out everything you can about the entrepreneur behind the business and what they had to do to get the business going. Write a report (at least half a page long) with your findings.